Question

CAPITALS ACC
41. (Fixed & Fluctuating Capital Alc's) On 1st January, 2017 A and B entered in a
and contributed * 40.000 and 30,000 respectively. They share profits and losses in the ratio of
3:2. B is to be allowed a salary of 8.000 per year. Interest on capitals is to be allowed at 5% pa
and 5% p.a. interest is to be charged on drawings. During the year A withdrew 6,000 and B
12.000 on which interest in case of A being 140 and B 100. Profit in 2017 before the above
noted adjustments was 21.160. Show the distribution of profits between the partners and prepare capital account
when (a) Capitals are fluctuating and (b) Capitals are fixed
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Answer 1

Answer:

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